Leases

12 Months Ended

Dec. 31, 2019

Leases [Abstract]

Leases

Leases

(In Thousands)

The Company enters into leases in both lessor and lessee capacities.

Lessor Arrangements

As of December 31, 2019, the net investment in these leases was $12,441, comprised of $10,735 in lease receivables, $2,739 in residual balances and $1,033 in deferred income. In order to mitigate potential exposure to residual asset risk, the Company utilizes first amendment or terminal rental adjustment clause leases.

For the twelve months ended December 31, 2019, the Company generated $331 in income, which is included in interest income on loans on the Consolidated Statements of Income from these leases.

The maturities of the lessor arrangements outstanding at December 31, 2019 is presented in the table below.

2020	$	1,011
2021	1,314
2022	1,989
2023	3,256
2024	1,057
Thereafter	3,814
Total lease receivables	$	12,441

Lessee Arrangements

As of December 31, 2019, right-of-use assets totaled $84,754 and lease liabilities totaled $88,494. The table below provides the components of lease cost and supplemental information for the period presented.

	Year Ended December 31, 2019
Operating lease cost (cost resulting from lease payments)	$	10,149
Short-term lease cost	67
Variable lease cost (cost excluded from lease payments)	1,612
Sublease income	(560		)
Net lease cost	$	11,268
Operating lease - operating cash flows (fixed payments)	9,678
Operating lease - operating cash flows (liability reduction)	8,407
Weighted average lease term - operating leases (in years) (at period end)	17.39
Weighted average discount rate - operating leases (at period end)	3.40		%
Right-of-use assets obtained in exchange for new lease liabilities - operating leases	$	38,881

The maturities of the lessee arrangements outstanding at December 31, 2019 are presented in the table below.

2020	$	9,725
2021	8,889
2022	8,420
2023	8,131
2024	7,549
Thereafter	78,124
Total undiscounted cash flows	120,838
Discount on cash flows	32,344
Total operating lease liabilities	$	88,494

Rental expense was $9,159, $6,157, and $4,827 for 2019, 2018, and 2017, respectively.

As of December 31, 2019, the Company had leases with related parties that were obtained in the Brand acquisition. The related party leases have right-of-use assets of $12,720 and lease liabilities of $14,956, with total lease cost of $1,968 for the twelve months ended December 31, 2019.

As required, the following disclosure is provided for periods prior to the adoption of ASC 842. The following is a summary of future minimum lease payments for years following December 31, 2018:

2019	$	9,389
2020	8,199
2021	6,339
2022	4,929
2023	3,711
Thereafter	12,592
Total	$	45,159

For more information on lease accounting, see Note 1, “Significant Accounting Policies” and on lease financing receivables, see Note 4, “Non Purchased Loans.”

Leases

Leases

(In Thousands)

The Company enters into leases in both lessor and lessee capacities.

Lessor Arrangements

As of December 31, 2019, the net investment in these leases was $12,441, comprised of $10,735 in lease receivables, $2,739 in residual balances and $1,033 in deferred income. In order to mitigate potential exposure to residual asset risk, the Company utilizes first amendment or terminal rental adjustment clause leases.

For the twelve months ended December 31, 2019, the Company generated $331 in income, which is included in interest income on loans on the Consolidated Statements of Income from these leases.

The maturities of the lessor arrangements outstanding at December 31, 2019 is presented in the table below.

2020	$	1,011
2021	1,314
2022	1,989
2023	3,256
2024	1,057
Thereafter	3,814
Total lease receivables	$	12,441

Lessee Arrangements

As of December 31, 2019, right-of-use assets totaled $84,754 and lease liabilities totaled $88,494. The table below provides the components of lease cost and supplemental information for the period presented.

	Year Ended December 31, 2019
Operating lease cost (cost resulting from lease payments)	$	10,149
Short-term lease cost	67
Variable lease cost (cost excluded from lease payments)	1,612
Sublease income	(560		)
Net lease cost	$	11,268
Operating lease - operating cash flows (fixed payments)	9,678
Operating lease - operating cash flows (liability reduction)	8,407
Weighted average lease term - operating leases (in years) (at period end)	17.39
Weighted average discount rate - operating leases (at period end)	3.40		%
Right-of-use assets obtained in exchange for new lease liabilities - operating leases	$	38,881

The maturities of the lessee arrangements outstanding at December 31, 2019 are presented in the table below.

2020	$	9,725
2021	8,889
2022	8,420
2023	8,131
2024	7,549
Thereafter	78,124
Total undiscounted cash flows	120,838
Discount on cash flows	32,344
Total operating lease liabilities	$	88,494

Rental expense was $9,159, $6,157, and $4,827 for 2019, 2018, and 2017, respectively.

As of December 31, 2019, the Company had leases with related parties that were obtained in the Brand acquisition. The related party leases have right-of-use assets of $12,720 and lease liabilities of $14,956, with total lease cost of $1,968 for the twelve months ended December 31, 2019.

As required, the following disclosure is provided for periods prior to the adoption of ASC 842. The following is a summary of future minimum lease payments for years following December 31, 2018:

2019	$	9,389
2020	8,199
2021	6,339
2022	4,929
2023	3,711
Thereafter	12,592
Total	$	45,159

For more information on lease accounting, see Note 1, “Significant Accounting Policies” and on lease financing receivables, see Note 4, “Non Purchased Loans.”